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Risk Management

What has winning in business got in common with victory in war?

Success in both business and war requires clever planning and proactive defences that are impenetrable and built to stand strong against a variety of attacks from different directions, says Warwick Goldie, head of Hollard Specialist Liabilities within Hollard Broker Markets.

So imagining yourself as a Napoleon, Churchill, Joan of Arc or Roosevelt as you plan for success in a boardroom has its place. It can put you in the right frame of mind to plan ahead in these tough times where knowing your battlefield is vital to achieving success. And this kind of defensive planning needs to be thought out in ‘peace time’ and not when the chaos has already hit in some form or another. That’s when the option to take charge has gone.”
In a business of any size the ‘battlefield’ that needs to be defended has many battle zones:

You need to be on the lookout and vigilantly monitor competitors and opposition

Short term as well as long term planning and strategy is essential

Your people (warriors) need to be motivated and skilled

Your products (ammunition) have to be cutting edge and hit the right target

Your defences against loss or damage must be impenetrable

All these ‘battlefields’ are equally important yet some receive more attention than others. The business strategists that enjoy sustained victory, no matter what, pay attention to all areas – including protections against loss and this comes in the form of insurance protection that is tailored and suited to defend against a variety of carefully assessed intrusions or invasions to profitability.

Defining precisely where defences are vital to victory is another call for brokers, business leaders and strategists to get into the battle strategy mind-set. “The complexity of war zones in today’s business environment has increased and so has the need for accurately identifying where insurance fortifications are needed. These defences need to keep pace with risk developments and go beyond the familiar, yet essential, insurance protections like burglary from outsiders, fire and theft. How do you define a battle strategy against the variety of liability insurance necessary in today’s business world?” asks Goldie.
Here are the areas that need specially defences and bullet proof vests:
COMPANY LEADERS: In the daily leadership challenges it is possible to make a wrong decision where your allies and partners suffer a loss and the person or people at the top can be held personally liable.
Defence Solution: Directors and Officers Liability Insurance (D&O).

ADVICE PROVIDERS: Providing professional advice to clients including: how to insure themselves, manage finance, construct, execute, design, or deliver can involve small or large mistakes and oversights, leading to financial consequences for your client.
Defence Solution: Professional Indemnity / Errors & Omissions insurance (PI / E&O).

INSIDER THIEVES: Despite tight controls and security within your operation, what happens if your own assets, money and property – or property of others in your care – is infiltrated and stolen by your own people on your ‘battlefield’?
Defence Solution: Commercial Crime insurance (CC).

SENSITIVE HR SLIP UPS: Taking care of your ‘soldiers’ can be difficult. There may be times when unintentional discrimination occurs or unfair labour practices take place. A liability law suit could follow this type of personal management mistake.
Defence Solution: Employment Practice Liability insurance (EPLI).

RETIRED EMPLOYEE FUND TRUSTEE: Key company leaders are the trustees of funds for looking after the long term financial wellbeing of ‘soldiers’ in post-retirement including medical aid. The trustees of these funds are responsible for acting in accordance with statutes and benefits being paid out correctly. They are also in charge of investment decisions being communicated appropriately and timeously. Oversights and mistakes can incur liability claims.
Defence Solution: Trustee Liability (Pension, Provident, Retirement, Preservation and Medical).

MEDICAL PRACTITIONERS: Saving lives and mending bodies is a challenging and continuous battle for people in the doctoring and nurturing business. A medical practitioner may face a situation where he or she cannot save a life or lives, neither can they prevent maiming and disfigurement. A hefty liability claim can follow if this is as a result of that medical practitioner’s negligence, whether actual or alleged.
Defence Solution: Medical Malpractice insurance.

PARTICIPANTS/SPECTATORS: These days spectators participate in many types of battles between teams, boxers, entertainers, hundreds of ‘who is the best’ competitions. Today’s legal reality is if participants or spectators slip, trip or get injured on site while watching or taking part, the organisers are liable and could be the target of a crippling claim.
Defence Solution: Two choices: Hollard’s once off Events Liability insurance or our annual Events Liability insurance (EL).

FAULTY PRODUCTS: Manufacturing and producing or merely distributing supplies and goods of any nature could lead to a battle if they cause damage. How do you defend yourself when you are so far removed from the cause of action?
Defence Solution: Public / General Liability (Broadform) (GL).

So why wait until it’s too late to assess and create a protective battle plan? Make and negotiate now on defences that work in today’s world. One of the most efficient strategies is for the correct business liability insurance to be in place. For brokers themselves as well as their clients in all categories of business the sooner your liability insurance protection is prioritised – tailor made, negotiated and confirmed – the sooner you can fight the commercial fight with the confidence of knowing your fortifications are tailored for success.

Warwick Goldie, head of Specialist Liabilities at Hollard.

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